Liz Moore retired a couple years ago from working in a variety of roles in the Ontario government for 34 years.Tijana Martin/The Globe and Mail
Liz Moore, 62, retired a couple of years ago after working for nearly 34 years in various roles for the Ontario government. The timing was right, says the Bradford, Ont., resident in the latest Tales from the Golden Age feature. She felt financially secure and had many other interests that she wanted to pursue.
“The transition was easy as I went from a career I loved to another big love – spending time with my grandchildren,” says Moore. “I only had 16 weeks of maternity leave in the 1980s and always wished I could stay home with my children at that crucial stage of development.”
Retirement was a chance to redo that chapter that she felt she’d missed, only now with her grandchildren.
As a lifelong learner, education has always been really important to Moore. “Shortly after retiring, I decided to pursue a PhD,” she says. Moore also thought it would be important to give back to her community, and joined the Women’s Institute, an organization that inspires women through experiences, knowledge and skills.
“My goal is to become what’s known as a “super ager,” she adds, a term for seniors over age 80 with the mental faculties of people decades younger. “My birth certificate says I am 62, but I still feel like I am 27.”
For more on Moore and her super-aging strategies, read the full story here
Calling all retirees: Are you a retiree interested in discussing what life is like now that you’ve stopped working? Globe Investor is looking for people to participate in its Tales from the Golden Age feature, which discusses the realities of retirement living. If you’re interested in being interviewed for this feature, and agree to use your full name and have a photo taken, please e-mail us a few details about your retirement life so far at: goldenageglobe@gmail.com
Should Irene melt down her RRSP to try to save some of her OAS from being clawed back?
In the year or two after her husband died, Irene got a crash course in financial planning, hiring and firing a series of investment advisers, selling her stocks and then reinvesting, and plotting a strategy to hang on to as much of her Old Age Security benefits as possible.
“I now manage my investments entirely on my own,” Irene writes in an e-mail. She is 66 and retired with no dependents. She owns her Manitoba house outright. Irene has a tax-free savings account and a large registered retirement savings plan with a discount broker, “all stocks,” Irene writes. She has a smaller TFSA, which she says is all cash in a variable savings account, a registered retirement income fund in a five-year GIC at 5.1 per cent, and a savings account.
Her regular monthly income includes slightly more than $1,000 a month in Canada Pension Plan benefits and a small defined benefit pension that pays slightly less than $1,200 a month. The balance she draws from her RRSP.
“I have deferred OAS to age 70 because I want to avoid having all of it clawed back, but I don’t think that’s possible,” Irene writes. The Manitoban feels she already has the financial freedom to spend money on travel and home renovations, but she still has concerns, such as making her money, including her OAS, last. Her spending target is $90,000 a year after tax.
In the latest Financial Facelift, Kaitlyn Douglas, a certified financial planner and chartered financial analyst with Manulife Securities Inc. in Winnipeg, looks at Irene’s situation.
Want a free financial facelift? E-mail finfacelift@gmail.com.
What is the best stocks/bonds asset mix for retirees? (Hint: it’s not 50-50)
It is generally advised that retirees should invest no more than 50 per cent in stocks, and the rest in bonds. In the latest Charting Retirement article, Fred Vettese, former chief actuary of Morneau Shepell and author of Retirement Income for Life, suggests that might not be the best approach.
Read the full article here
In case you missed it:
This is the best time in ages to crashproof your RRIF
Seniors contemplating a withdrawal from their registered retirement income fund in early 2023 have tough choices to make after the double-barrelled decline of stocks and bonds last year.
What do you sell to free up money for your mandatory annual RRIF withdrawal? Bonds were hit harder than stocks but offer rebound potential. Stocks wobbled badly in late 2022 and could be vulnerable if a recession takes shape this year.
Prefer to leave both stocks and bonds alone to heal? It’s doable if you followed the basic crash-proofing strategy of keeping two or three years’ worth of annual RRIF withdrawals safe in cash or cash equivalents.
At times like this, with balanced portfolios in the red after a hard year, this cash can be tapped to fund a RRIF withdrawal.
It’s also a particularly good time to set up a RRIF safety net because interest rates remain at elevated levels compared with previous years.
Read the full article here
Globe Advisor’s Best of 2022: Retirement planning strategies worth considering
Although financial advisors help their clients plan and prepare for various important life events and milestones, none are as central as retirement.
But while it’s critical for advisors to make sure clients have sufficient assets to produce the income needed to last for the rest of their lives, there are many other factors both parties need to consider – financial and not.
From real estate and the housing market to deferring collecting CPP or the latest in alternative pensions, these 10 articles on retirement planning strategies are what drew Globe Advisor readers’ attention in 2022.
Read the full article here
Retirement Q&A
Question: My husband receives a small pension from Germany. As soon as he started to receive it, he added it to his Canadian tax filing as per our government’s policy. Two years ago, he was contacted from Germany and informed that he had to pay tax on this German pension. He has paid all the outstanding tax to the German government and is up to date. But, we are puzzled because the Canadian government indicated that he must declare all income, including a pension from another country. So, is he paying tax here on this, as well as in Germany? Are we being double taxed?
We asked Jamie Golombek, managing director & head, tax & estate planning at CIBC Private Wealth in Toronto, to answer this one.
As a Canadian taxpayer, you do need to report and pay tax on your worldwide income, which generally includes foreign pension income. If you paid taxes to Germany on the same income, you should be able to claim a foreign tax credit on your Canadian return for the taxes paid to Germany on that income.
You may even be able to adjust prior years’ tax returns (up to 10 years) to get the Canada Revenue Agency to allow foreign tax credits for German taxes paid in prior years.
Calculating foreign tax credits, as well as amending prior returns, however, isn’t for the faint at heart, so it is advisable to seek the advice of a knowledgeable accountant or tax preparer to assist you, at least the first time around!
Have a question about money or lifestyle topics for seniors? E-mail us at sixtyfive@globeandmail.com and we will find experts and answer your questions in future newsletters.
